Locked-In Retirement Accounts

Did you know that you may be able to ‘unlock’ your Locked-In Retirement Account (LIRA)?  Some people who have worked for a company for a period of time and left may have had a pension plan that they ‘took with them’ and deposited the funds into their own financial institution to manage on their own.  These funds are invested similar to RRSP’s as clients must choose their own investment selections, including asset mix and geographical mix.  These LIRA’s will eventually be transferred to Life Income Funds (LIF’s) if you reside in Ontario (and some other provinces) to provide a stream of income at retirement with restrictions.  In. other words, you are restricted as to what you can take out annually.  However, if your LIRA is less than the Yearly Maximum Pensionable Earnings (YMPE) then you are able to take the funds out of your LIRA and transfer them to your RRSP.  YMPE for 2010 is $47,200.  Some clients have small LIRA’s so moving them to your RRSP’s means that you have no restriction as to how much you can take out at retirement!!!

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  1. Kathleen,Great blog! Thanks for the valuable info. When can one transfer a LIRA to a RRSP? Do you have to wait until you retire or can you do it at any time?Thanks!Tobi

  2. You are welcome, Tobi. Providing the requirements are met you can transfer the LIRA to your RRSP at any time.

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